Topline
The fate of President Donald Trump’s sweeping “Liberation Day” tariffs on foreign imports may play out in court, after the first major legal challenge to them was filed in court Monday, as conservative lawyers have alleged the president is exceeding his authority by enacting tariffs under the International Emergency Economic Powers Act (IEEPA).
Key Facts
Trump has used the IEEPA as the legal justification for his tariffs, as the president first levied tariffs on China, Canada and Mexico before issuing and then paring back more sweeping tariffs on most foreign goods, now imposing a baseline 10% on most foreign imports while many Chinese goods face an import fee of at least 145%.
The IEEPA gives presidents power to take major economic steps and impose sanctions during national emergencies—defined as an “unusual and extraordinary threat” to the U.S.—saying they can “investigate, regulate or prohibit” foreign transactions, trade of currency and securities, and payments or credits that involve the foreign countries posing a threat.
It does not say anything explicitly about tariffs, however, which has sparked legal action against them: The nonprofit Liberty Justice Center—which is nonpartisan but has previously represented conservative interests—filed a lawsuit Monday in the U.S. Court of International Trade on behalf of U.S.-based businesses, which argues Trump overstepped his authority by using the IEEPA to justify his tariffs when the law doesn’t actually allow that.
The lawsuit was the first to take aim at Trump’s “Liberation Day” tariffs announced April 2, though the New Civil Liberties Alliance—which is also nonpartisan but has historically taken conservative positions—previously sued Trump on April 3 over his earlier tariffs on China, arguing on behalf of a Florida-based stationery company that the IEEPA “authorizes presidents to order sanctions as a rapid response to international emergencies” but “does not allow a president to impose tariffs on the American people.”
Only Congress has the authority to levy the sweeping tariffs Trump has imposed, the two lawsuits argue, with the Liberty Justice Center writing Congress has not “delegated” sweeping authority to issue tariffs to the president—and, even if they had, doing so “would be an unlawful delegation of legislative power to the executive without any intelligible principle to limit” the president’s power.
The Liberty Justice Center also alleges there’s no national emergency that justifies invoking the IEEPA to impose tariffs against nearly all countries—even uninhabited ones—writing any national emergency “is a figment of [Trump’s] own imagination,” as “trade deficits, which have persisted for decades without causing economic harm, are not an emergency” or an “unusual or extraordinary threat.”
What To Watch For
The White House has not yet responded to either of the lawsuits in court, and has not responded to a request for comment on Trump’s use of the IEEPA to justify his tariffs. The Liberty Justice Center’s lawsuit asks for the U.S. Court of International Trade—which decides international trade disputes—to nullify Trump’s executive orders imposing sweeping tariffs and declare them unlawful. NCLA has not yet responded to a request for comment on whether it will expand its lawsuit to include Trump’s more recent round of tariffs, which have escalated tariffs on Chinese goods to at least 145%, as the lawsuit now only targets his executive orders issued prior to April 2. The Trump administration is also now trying to have that case, which was filed in federal court in Florida, transferred to the Court of International Trade. Legal experts predicted to ABC News they expect the legality of Trump’s tariffs to ultimately be decided by the Supreme Court, with even conservative attorneys predicting to the outlet that justices are likely to rule against Trump’s tariffs. “There is a strong argument that the tariffs imposed under the IEEPA are not legal or constitutional,” a conservative lawyer close to Trump told ABC.
Could Lawsuits Undo Trump Tariffs?
The Liberty Justice Center’s lawsuit broadly asks for Trump’s “Liberation Day” orders to be withdrawn, representing businesses that import goods from the European Union and countries including South Africa, Lebanon, Morocco, South Korea, Japan, China, Taiwan, Thailand, Oman, India, Vietnam and the Philippines. It remains to be seen whether the court will grant sweeping relief that affects even countries not mentioned in the lawsuit, as legal experts cited by the Economist previously noted there may be issues with court granting relief that affects every country affected by Trump’s tariffs. Courts only grant relief to plaintiffs who bring lawsuits if they have standing to sue, meaning the thing they’re suing against directly harms them. That means if a company doing business in Vietnam brings a lawsuit claiming Trump’s tariffs harm them, for instance, a judge could block Trump’s tariff on Vietnam, but it’s less likely their ruling would undo tariffs on somewhere unrelated, like the EU. If the U.S. Court for International Trade decides not to unilaterally block Trump’s executive order on tariffs, as plaintiffs have requested, that could lead to a series of patchwork rulings on tariffs. Courts could block some tariffs that affect companies or nations that sue, but leave in place other tariffs on different industries or industries. One exception would be if the Supreme Court rules Trump doesn’t have the authority to impose tariffs under the IEEPA, which The Economist notes should force the Trump administration to pull their tariffs across the board.
Can Trump Just Impose Tariffs Under Other Laws?
Trump cited other laws in his executive orders imposing tariffs, like sections of the Trade Act of 1974 and the National Emergencies Act. None of those laws appear to justify the sweeping tariff actions Trump has imposed, however: One cited section of the U.S. Code just lets Trump delegate actions to other officials, for instance, while the National Emergencies Act governs how Trump can declare national emergencies. The cited section of the Trade Act of 1974 allows Trump to make changes to tariff schedules. During his first term, Trump used other provisions of federal law to impose tariffs, such as section 301 of the Trade Act, which allows tariffs if other countries violate trade agreements, or section 232 of the Trade Expansion Act, which allows tariffs in order to protect national security. Those laws only allow tariffs in more limited circumstances than how Trump has now applied them across countries and industries, however.
Why Are Conservatives Arguing Against Trump On Tariffs?
The legal argument that Trump is exceeding his authority by imposing sweeping tariffs is actually in line with what many conservatives have been arguing for years. Many on the right have opposed what they call the “administrative state,” or the executive branch taking what conservatives feel are too many liberties in how officials interpret federal law to craft regulations. Conservative politicians and groups, including the NCLA, filed numerous lawsuits against President Joe Biden’s administration under that legal argument, which led to major policies like Biden’s sweeping student loan forgiveness policy and various COVID-19 restrictions getting struck down in court because judges ruled the president exceeded his authority. Conservatives then got a major win last year when the Supreme Court overturned its precedent that gave the executive branch and federal agencies broad leeway to interpret federal law, meaning judges now have more power to decide whether federal regulations are actually legal. NCLA used that ruling in its lawsuit against Trump’s tariffs, saying the court can interpret the IEEPA without being at all deferential to the Trump administration’s argument that it allows tariffs.
Key Background
Trump has made tariffs a key part of his policy agenda during his second term, fulfilling a longtime campaign promise despite warnings from economists that doing so would raise prices for U.S. consumers and harm the economy. The president first levied tariffs on China, Canada and Mexico before rolling out tariffs on nearly all foreign nations last week. The president’s initial plan levied tariffs at various rates on different countries, which reached as high as 50% in some cases based on the U.S.’ trade deficits with those nations. The steep tariff agenda caused chaos in the global markets, with stocks plunging as economic experts warned a recession was likely on the way. While Trump and his officials insisted for days the president would not pause his tariffs despite the havoc they wreaked on the economy, Trump ended up unexpectedly halting the worst of his tariffs Wednesday afternoon. The president imposed the 90-day pause on much of his tariffs—while keeping a 10% baseline tariff rate and increasing China’s tariffs by 125%—claiming he made his decision because people were “getting a little bit yippy” over the tariffs and the economic chaos they sparked. White House economic adviser Kevin Hassett suggested Thursday the 10% tariff rate will remain in effect for the foreseeable future, even if countries negotiate deals with Trump to avoid higher tariff rates, and the president told reporters Wednesday he still wants to levy additional tariffs on pharmaceuticals.